Atty. Julius Gregory Delgado
“ARIEL M. REYES VS. RURAL BANK OF SAN RAFAEL (BULACAN), INC. ET AL.”, G.R. NO. 230597 (MARCH 23, 2022): CHANGING CHARGES IN DISMISSING AN EMPLOYEE AMOUNTS TO DENIAL OF PROCEDURAL DUE PROCESS
On March 23, 2022, the Supreme Court issued a Decision of even date in G.R. No. 230597 entitled “Ariel Reyes vs. Rural Bank of San Rafael (Bulacan), Inc., et al.” The case stemmed from a complaint of several stockholders of Rural Bank of San Rafael (Bulacan), Inc. (“RBSR”) about discrepancies in the amounts of the purchase price of stock subscriptions as appearing in the original receipts as against duplicate copies issued by the bank. The anomaly supposedly involved several millions of pesos collected from stockholders of RBSR which, if not corrected, will certainly tarnish the image and integrity of the bank. RSBR conducted an investigation and confirmed the irregularities discovering that in the original receipts given to the stockholders, the stated price of shares ranged from Php250.00 to Php275.00 per share, but in the duplicate copies retained by RBSR, only PhP100.00 was indicated. The original receipts were signed by Flordeliza Cruz, then President of RBSR, while the duplicate copies were signed either by its then Treasury Head, Emilline Bognot (“Bognot”), or Branch Manager Reynaldo Eusebio, Jr. (“Eusebio”).
Under the Manual of Regulations for Banks mandating prompt report of anomalies to the Bangko Sentral ng Pilipinas (“BSP”), RSBR’s Board of Directors approved a Report on Crimes and Losses and directed petitioner Reyes, being the Compliance Officer, to certify the same. However, petitioner Reyes refused to certify the report reasoning that no independent investigation was conducted, and that he cannot completely validate the same for lack of material data and evidence, and that he was being pressured to certify the report. Instead of furnishing him hard copies of the reports and its original attachments to enable him to verify and certify the same, RBSR issued him two show cause orders and put him under preventive suspension. Hence, along with Bognot and Eusebio, who were accused of theft/misappropriation, petitioner Reyes filed a Complaint for illegal dismissal and money claims.
The Labor Arbiter favored the complainants and directed the payment of backwages. The Labor Arbiter issued the ruling sans the appearance and Position Paper of RSBR despite being notified and getting a copy of the Amended Complaint. The National Labor Relations Commission, however, reversed the Labor Arbiter ruling that the bank was denied due process. Reyes and Bognot filed a Petition for Certiorari before the Court of Appeals but to no avail. Only petitioner Reyes went to the Supreme Court and questioned the ruling of the Court of Appeals affirming the decision of the NLRC.
The Supreme Court held that it was petitioner Reyes who was deprived of procedural due process for lack of particularity and specificity of the charges lodged against him. In the first document he received, “Show Cause Order and Preventive Suspension” dated March 22, 2013, it would appear that petitioner Reyes was being charged with either willful disobedience or insubordination, or gross and habitual neglect of duty. After receiving the second document, “Administrative Case”, dated April 4, 2013, which informed him of the scheduled hearing, he received a third document, “Show Cause Order”, dated April 19, 2013, which changed the charges from either disobedience or neglect, to commission of a crime or offense. The Supreme Court held that petitioner Reyes was not afforded due process:
“In the present case, while it is true that Reyes was given sufficient opportunity to explain his side during the investigation, the Court cannot help but notice the muddled and vague charges against him. Specifically, it cannot be determined with reasonable certainty on what grounds the charges pressed against Reyes were based on, and which ones were proven. While it would appear that Reyes was initially charged with insubordination or neglect of duty, the show cause order surprisingly accused him of participation in the alleged theft/misappropriation, and neither is there any showing that the same has been established nor is it specifically mentioned as the reason for his dismissal. Instead, the termination letter sent to Reyes, which is a mirror copy of the ones sent to Bognot and Eusebio, merely employed general and loose statements. Neither is there any mention of which specific rule or policy Reyes allegedly violated. Surely, this is not the kind of notice contemplated by the Labor Code and its implementing rules. In view of all the foregoing, the Court finds that respondents failed to comply with the due process requirements in dismissing Reyes.”
In any event, the Supreme Court held that while it may be a form of disobedience for petitioner Reyes not to certify the Report on Crimes and Losses, such was not attended by a wrongful and perverse mental attitude which warrants the ultimate penalty of dismissal. The Court agreed with the findings of the Labor Arbiter that Reyes refused to certify the said report based on his honest assessment that the report cannot be completely validated for lack of material data and evidence. The Court also noted that petitioner Reyes was able to send Memoranda dated February 14, 2013 and February 22, 2013 to the officers and directors of RBSR noting several deficiencies in the report and made recommendations in order to make the same compliant with BSP regulations. The Court held that this betrays the bank’s claim that petitioner Reyes was involved in the theft/misappropriation allegedly committed by Bognot and Eusebio. # # #